Memeorandum

April 27, 2013

A Tax They Don't Like?!?

The NY Times runs a story with a lot of sympathy for small business owners opposed to the proposed internet sales tax. Did these small business owners convince the Times they were not part of the dreaded 1 Percent? Well, maybe they saw it as millionaires versus billionaires:

The Senate is poised to pass a bill to require
all but the smallest online sellers to collect the tax. The House
appears likely to follow suit. Although Amazon’s desire to avoid the tax
played a fundamental role in its founding and growth, it is a supporter
of the legislation.

...

Figuring out the tax in thousands of jurisdictions could be a logistical
nightmare for merchants just above the legislation’s threshold of $1
million in annual revenue. That is another place where Amazon is
expected to benefit; it could sell tax collection services to tens of
thousands of third parties.

...

EBay, Amazon’s close competitor, has fought the bill, saying the
threshold to collect the tax should have been substantially higher than
$1 million in revenue.

For some eBay sellers, the legislation is less about leveling the
playing field than permanently tilting it against them.

“This is all about the big Internet companies — Amazon, Walmart —
crushing the small companies,” said Chris Chapman, who sells winter
sports equipment on eBay, Amazon and through his own Web site, SnowSportDeals.com.

His sales are slightly over the threshold. That means Mr. Chapman, who
is based in Maryland, will either have to spend many hours figuring out
how to collect taxes himself or pay someone to do it for him.

“This will make it harder for people like me to start a Web business,” Mr. Chapman said.

“So Amazon will just get more customers. It’s win-win for them.”

This is more of Obama's corporatism in action, aqlthough to be fair, with a different result it would have been McCain's corporatism in action. Being pro-Big Business is not at all the same as being pro-business, as the Times is beginning to understand.

Comments

Software can help calculate and collect the taxes... what will kill small to mid sized businesses is the random audits vig collectors from each taxing jurisdiction inviting themselves in to audit the books and assess fines payola.

“As a former White House Correspondent, it’s really nice for people in politics and media to come together and have a little weekend of fun,” MSNBC host Alex Wagner told POLITICO at a reception at the Hay Adams hotel. “I understand the idea of the ‘celebrification’ of the event but I think it’s more of a testament to how interesting and compelling Washington politics is to the outside world.”

and

Former Mitt Romney spokesman Ryan Williams said, “Tom’s obviously entitled to his opinion. It’s a fun event for everybody, it’s for people from outside Washington [to] come see how things work in the capital and how people in this town operate.”

and

Some journalists said they didn’t see any downside to the dinner on Saturday night and the weekend of parties and events.
New Yorker editor David Remnick, whose magazine threw a Friday night soirée on the roof of the W Hotel, told POLITICO he doesn’t think the White House Correspondents’ Dinner undermines the press.

That last one is probably true, if only because it's hard to undermine the press more than it already is.

Jen Rubin exemplifies the terminal affliction of the GOP. After two squishballs got their clocks cleaned by the JEF, she insists the problem is Reagan. It's like a doctor of a stroke victim claiming a heart transplant is needed.

OT to the financial sorts. Did you see this week's announcement on recalculating GDP in the future? It says it will better reflect creativity and innovation except all that funding is largely originating in govt Industrial Policy.

James D., I'm trying to avoid hyperbole on this topic... but it may not be possible. The latest twist is that local tax jurisdictions have started hiring rent-a-mobs to collect and assess taxes (only states did this in the past). These guys get paid a commission, so they "mass market" compliance letters. There are nearly 10,000 taxing jurisdictions. Typical audit is for 10 years prior, when none of these internet entrepreneurs were collecting taxes so this may be the biggest theft of wealth in world history.

The Democrat angling to take on Christie announces to the world that Chris Mathews is "kinda of a JackASS"! She forgot to add "and a huge douchebag", but nevertheless I want to call attention to the fact that a major Democrat and I share the same opinion on an issue of the day!

I would love to see more states counter this proposal by getting rid of their sales taxes altogether. Because Income tax, capital gains tax, interest tax, various excise taxes, property tax, corporate tax and inheritance taxes really ought to be enough to run a government.

Instead, I suspect the trajectory we're on sooner leads to VAT. And anyone who paid buckets of taxes while saving and budgeting for lower-taxed retirement can just suck it up and practice saying "Welcome to Walmart!".

Some states don't levy an income tax. Makes the sales taxes much more important. Eight states I believe. Taxing consumption as opposed to taxing wealth ( savings ) is a far better policy which will ultimately inure to the benefit of all.

All taxes have fairness issues, Consumption taxes included. Consumption tax unfairness becomes especially egregious when the administrative onus is legislatively foisted upon non-residents to perform the administration and own the legal liability of properly collecting them because it's just too hard to have the residents -- the BENEFICIARIES -- of those taxes pay their own damn taxes.

Sales taxes ONLY work as point of sale transactions. When the point of sale is out of state makes that a problem, it seems reasonable to me to consider replacing the revenue source vs. deflecting the problem onto every business and every other state in the country.

gmax - what are the sales taxes now in your TX and FL locations? MO does have income tax after a certain amount, but because my income is below that threshold, moving to FL or TX does nothing for me. Plus, I steer clear of legions.

Donald Kagan is the interviewee in today's WSJ and decries the monoculture of academia today. There simply are no dissenting opinions. They have all accepted the revealed truth. Since most of the media watered at the same trough, we get the same monolithic, unthinking crock from them.

The recalculation of GDP is to my understanding, the inclusion of intangible property, which has now by fiat become tangible. This gives the baboons in government the ability to declare to the world how wonderful and well cut the emperor's clothes are.

Screw it. I just have get used to having my savings vacuumed up by the state. What was I thinking, living modestly, saving aggressively, staying out of debt? I need to ratchet up my smoking lest I outlive what just a month ago was a comfortable nest egg.

I have amazon prime and buy everything possible thru it because even if the prices on some items may be slightly higher there are no sales taxes os hipping charges, Once they add sales taxes I may reconsider though in anticipation of the thieves latest efforts, I've really stocked up.

“Look at what we publish,” he said. “Does it seem like it corrupts us?”
Over the years, Remnick noted that the New Yorker has published groundbreaking stories on torture, drone strikes and other sensitive topics in D.C.

Yeah, we know about the "torture" articles (and the "stovepiping" stuff), and reams of paper criticizing GW Bush. The groundbreaking stuff on Obama? Not so much. Here for example, is one of the early articles on drone warfare. It sums up with the view of Bruce Reidel, who "sees the choices facing Obama as exceedingly hard." Yeah, he's making those hard decisions. More recently, the same author explained the moral difference between Obama and Bush:

Obama, in contrast, has tried to bring his counterterrorism program inside the law by reasserting the criminality of torture and by trying to define which drone strikes are legal.

Hard-hitting, right? Need a napkin after that, lady?

Yeah, the optics are bad. But not because some celebrity might not have the chops to consort with the lapdogs. It's because while they were willing to make stuff up about Bush, they can't bring themselves to criticize the Messiah (or even ask him a question that might make him uncomfortable). We see what you publish Mr Remnick . . . and yes, that's the real problem.

CT;
I agree. Bammy is totally inept wrt any foreign relations problems. It's like a big hole in his resume. Heis completely at sea in regard to how to fight a war on terror. He can't even use the word jihadist to describe our 2 Boston bombers. Pathetic.

Florida law mandates a minimum sales tax rate of 6%, collected by the state government to provide services to all Floridians. However, the law also provides for a local option sales tax that lets each county set its own local tax that is collected on top of the general state rate.

Its really hard to go through life with rectal cranial inversion aint it, Holly dear? Look up Okaloosa County and you will find a 0% local tax rate. Damn that whoopin' will stop stinging and you can sit down again in an hour or two but make sure you don't snap your neck when you do...

"Mr. ALEXANDER: Mr. President, I see the principal leaders for this legislation, Senators Durbin and Enzi, and I congratulate them for their leadership. What they have been able to do is to come up with a simple, 11-page bill that has two words for a theme--States rights or 10th Amendment. We have a majority of Senators on the Democratic side and a majority of Senators on the Republican side who have indicated their support for it. They voted twice in support of it.

I wonder if, before I finish, I might ask the distinguished Senator from Illinois a question. Maybe I am just sensitive to this as a former Governor, as I know the occupant of the Chair is as well, but I wonder if the Senator from Illinois finds it a little ironic there are some people in Washington who say they do not trust the States to make decisions about their own tax structure. I was Governor of a State that has a triple-A bond rating, no State debt on roads, no income tax, is one of the best run States, and when I was there had eight balanced budgets. Unfortunately, during the 10 years I have been in the Senate, we haven't had any of that. So I feel just the reverse.

In a constitutional framework that has a 10th Amendment that says decisions are reserved to the sovereign State, it not only smacks of a lack of respect for our constitutional structure, but it makes no sense to me that Members of Congress would not trust the Governor of Tennessee and the Legislature of Tennessee to make their own decisions.

We had a representative today at a meeting that all three of us attended who said that in Ohio, as I recall, the legislature and the Governor have already decided that if we pass this law permitting Ohio to collect taxes from everybody who already owes them rather than just some people, they will reduce their income tax rate.

So does the Senator find it ironic there would be people in Washington who don't trust the States to make decisions for themselves in a constitutional system that was created by sovereign States?

Mr. DURBIN. I thank the Senator from Tennessee for posing that question, and through the Chair I would say to him that I am in a tough position here facing two former Governors--Governors of West Virginia and Tennessee--but I am sure they agree with what I am about to say.

In this circumstance, the decision was made by the State of Tennessee--and West Virginia as well--as to what the sales tax would be by the people living in the State and making purchases in the State. We don't change that at all. That is up to the States to decide.

As I mentioned, four States, maybe five States, when it comes to sales tax, have no sales tax. What we are putting in this bill will not change that in any way. If you live in Oregon, you will pay no sales tax because of this bill for what is sold over the counter or over the Internet.

Our friends from Delaware are supporting this bill because they think because they are a no-sales-tax State surrounded by Pennsylvania and New Jersey and Maryland, they are going to have an advantage. They believe people will cross the borders to buy in Delaware. So they have calculated this actually helps them."

Pssst, how did I know that he would take
the bait - errrrow - hook, line and sinker? LOL

BTW, folks, to save face, he just lied again.

It is interesting, though, that he lives in Okaloosa County, don't you think? That tells us, for one thing, that his home is on wheels, and his front yard is decorated with rusty bed springs, an old '49 Ford pickup truck and a tacky ceramic pink flamingo. But then we already knew that he is an old toothless goober, didn't we? No wonder he doesn't pay tax.

Non responsive to the issue, again for what the third or fourth time? What exactly is the tax rate in Florida? C'mon you must have a source for your misinformation. Get out your Crayola and write it down slowly, we will wait. Or better yet continue not to do so, and prove you are the liar we all believe you to be!

Florida Department of Revenue website to check at your leisure but here is a cut and paste word for word:

Each sale, admission charge, storage, or rental is taxable unless the transaction is exempt. Sales tax is added to the price of the taxable goods or service and collected from the purchaser at the time of sale. Florida's general sales tax rate is 6 percent

Alice, the states require full registration info to use the "free" software, that is tax ID#, bank account# etc -- no privacy at all for you or the customer. Many states resell this info (like drivers license info) to mass marketers, others simply don't protect it at all. Further, there are 50 states (plus territories) that must be individually registered for tax calculation / submission.

Most counties in Florida have a 7% or 7.5% tax rate. In my county its 7% and we are an ocean community. There are a few counties (the vast minority) who keep it at 6% and do not impose their own local tax option. Okaloosa is an example as well as Lee.

However, if you buy a car in my county the 1% local sales tax option is limited to a max of $50.00.

Now, property taxes is another matter especially if you are not homesteaded.

DrJ, I don't know about price (the ERP my firm writes has tax calcs included -- but not rates -- and interfaces to various rate services), but several vendors sell this for either on premises or cloud access. Actual tax filing services (on the various monthly / quarterly / annual schedules a combination of states will require) is quite expensive -- that's why I know about the state "free" forms and audit goon squad visits. ;)

Well, I'm exclusively a customer in this scenario - I don't sell stuff. So anytime I buy online, a vendor using this software will have my name, address, product I'm buying, etc... (I assume most of the time, credit card details are not saved in the clear by the vendor) and all this info is now no longer subject to privacy agreements between me and the vendor? Because the vendor sends it on to my State, and my State has its own rules and plans for what they do with my data?

Hm. That doesn't sound like it should be legal. At least, it doesn't sound like a vendor can be held liable for breach of privacy given the responsible handling of the personal info is not in their control.

Alice, bullseye. On credit card data, the credit card people have strict standards on retention. Any vendor with sense uses a credit card service external to the firm's systems to avoid a credit card audit of all systems in place and massive fines. Not all vendors have sense or modern systems that comply with standards.

henry, after I posted I realized it is one thing to get the right charge and quite another to file the sales taxes with the appropriate body. That would be a real mess without the sort of service you mention.

I hear you, Henry. But I'm in the boonies, so any "in person" shopping beyond very basic groceries, lumber, cattle feed (heh) or garden mulch means a minimum 40 mile round trip. That gets me to a Walmart and a Lowes. If those stores don't have what I want, it's 150 or 200 miles round trip.

This was a feature, not a bug, when I moved here. Now... guess I'll have to get over how much I hate to drive.

You know that we could all see this internet tax coming. We just didn't want to consider that they would actually do it. There is just too much money being spent on the E-tail sites from Amazon to EBay to Wag to Soap to even cars.

[We bought our our car on the internet from England so it would be waiting for us when we came back to the States. That was in 2003.]

I am surprised it took this long for the polticians to figure out how to get their grubby little paws on more of my income and savings.

Yes, Cloonan, Coleman, and Soufan but not Gaudin,
he was SERE trained as part of the rangers, so he wasn't verklempt by the EIT's, those were
Mayer's sources along with Grenier, and Dannenberg who badmouthed Rodriquez and those under him,

Alice-I am not exaggerating at all that the Natl Research Council put out a report last summer that the govt and the tech companies using all that Big Data being generated most of us are not aware of could plan the economy around Sustainability. It was not a hypothetical either. It is the plan.

We are in a predator state clench. DC, except Janet and Clarice of course, and too many state and locals have a very feudalistic view of taxpayers.

Your lucky. Collier is one of only 11 or 12 counties in Florida without a local sales tax option. Most of the ones with higher levels of sales tax do not have the more affluent properties to tax and make up the difference. Mostly interior counties have the 7 to 7.5% level.

Of course Naples and Marco Island having some of the highest property values in the state, you now know why you are getting off so cheap. But how do you like the congestion?

I've been working like a dog since I got here so the congestion is the last thing on my mind. This morning was a breath of fresh air because Man Tran fixed me up with one of his friends and it was like she and I had been best friends forever. We had breakfast on 5th AVE and then She took me on a tour of Naples - to the high end section - and it was a riot to hear her tell me about it.

At this point I'm just tired. It's been a very long week and it is not over yet.

...an Italian law enforcement agency under the authority of the Minister of Economy and Finance and part of the Italian armed forces. The Guard is essentially responsible for dealing with financial crime and smuggling; it has also evolved into Italy's primary agency for suppressing the drugs trade. The Guardia di Finanza maintains over 600 boats and ships and more than 100 aircraft to serve in its mission of patrolling Italy's territorial waters.

61,286 employees in a country of 60M, plenty of whom are on foot with FBI-like jackets displaying the agency's name and demanding restaurant receipts from tourists at outdoor cafes.

That's one national tax collector for every 1,000 people in Italy. The IRS would need to more than triple its workforce to match that ratio here.

Gmax-do you have any idea what Saturdays are like in Destin in the summer? Or 331 coming over the bay?

And Walton's sales and property taxes are awful because of all the lovely beachfront state parks paying no taxes couples to a four story or 52 foot max height. It makes it lovely but the density in Okaloosa funds its expenses much better.

And jury duty reports to Pensacola. Still much less densely populated compared to rest of the state.

New Hampshire, the tax free state, has one toll booth across I-95. Anyone travelling within the state can easily avoid paying a toll on I-95. But if you are travelling through the state, and doing it directly and staying on I-95, you will pay the toll. Methinks the original plan was to establish a toll on either end, so you would pay entering and leaving the state, but could travel toll-free within on I-95, but someone must have pointed out early on that that would not pass constitutional muster.

States will do whatever they can to tax another states citizens. It's why a hotel room charge is never anywhere near the advertised rate- the state and local jurisdiction taxes on hotel rooms are usurious in nature.

RSE no but I am soon to find out. Its a 15 minute, WALK, to the beach. I will deal with the traffic. Funny thing is, I listened to horror stories about Spring Break and then found absolutely no problems this spring.

Ever been on Westheimer in Houston at quitting time? Now that is congestion. Congestion is the Kennedy in Chicago or 1-35 in Austin, or I 75 in Atlanta or the granddaddy of congestion is the 405 in Cali...

I was once on Manhatten trying desperating to catch a plane when Nelson Mandela decides to address the UN. That left a deep mark...